This afternoon Delimiter posted an article from Exetel's CEO about Ageing Australia not being interested in seeing broadband speeds of up to 1Gbps.

Here is an excerpt from the article:

During the election campaign, Communications Minister Stephen Conroy revealed the NBN would support speeds of up to 1Gbps, instead of the 100Mbps initially planned — after NBN Co chief executive Mike Quigley informed him the upgrade would cost no extra.

But in a blog post published today, Linton — who leads one of the few ISPs to provide broadband in Tasmania over the fledgling NBN network in the state — said it was “the unthinking and just plain stupid” who were excited about the additional speeds.

“Pretty much along the same lines as the stone age cargo cult dwellers in the jungles of New Guinea are excited about the next ‘goods drop’ from the strange coloured bird,” he wrote.

Linton added Australia’s ageing population — who he said didn’t “play online computer games or get a surrogate sex life from pornography” had no interest in terabyte broadband plans (such as have been recently released by some of Exetel’s competitors on ADSL) and speeds that could never made a difference to the internet applications they used.

“They are going to be the ever growing percentage of Australians who are going to drive the percentage of residences that don’t have any sort of wire line connection to their home,” he said.
Linton has been a long-time critic of the NBN and a supporter of the incoming generation of 3G mobile broadband and wireless solutions as an alternative.

28 comments

While I myself right now don't need 1Gbps, shouldn't we plan for a network that has capacity well into the future? Everyone is knocking on the Coalition that their plan is so 20th century technology and will keep us in the dark ages, but if we similarly say that we'll never need 1Gbps, we'll shoot ourselves in the foot. Nobody can predict what our data needs will be in the next decade. Nobody could have predicted the downloads (volumes and speeds) we now use, streaming TV at almost HD levels, a decade ago. Better to be prepared, but don't put in that trickle-drip filter, then we may as well stick with the coalition's plan.

Comment by Michael on 31 August 2010 at 04:13

I'm all for a 1GBps internet speed, it would be great. I play a lot of online games and would appreciate a faster connection speed, but think there are many issues more important than getting a connection fast enough to download a movie in a second. Perhaps the government should think about spending a little less on this project, or even stretching it out over a slightly longer period of time, and use that money to support other areas of need.

That being said GIVE ME 1GBPS INTERNET!! =)

Comment by Darth on 31 August 2010 at 04:16

Promised speeds are never actual speeds under load.... So folk who have grown up with the broadband realtime airwaves supplying their entertainment, or actual copper wire telephony, haven't experienced the digital wobblies. Sure old folk don't understand broadband... but they do understand "if you have the option to get ten times as much for free, jump at the offer" because old folk know how to squeeze a lemon.

At the markets, if they offer you a punnet of strawberries for a dollar, or a carton for five bucks... old folk know the math. It's a better deal to take the lot and make jam for the rellies. If you explained to these folk "it costs them the same to give you ten times as much as they're offering" they'd take the higher number on principle.

At the moment old folk in Australia pay for gigabits of bandwidth on cable that they're not interested in - stuff aimed at the young American middle class - they'd give that up in a second for the same bandwidth of entertainment they actually cared for. Given the option they'd wish it for the young folk (for entertainment and business) too.

Old folk aren't idiots... they're canny consumers. The options however aren't explained to them in everyday language. Given the options in a sensible vernacular, they'd predominantly be NBN. These are folk who've grown up with "classless" media and telephony, and respect that paradigm.

Comment by Paul Vigo on 31 August 2010 at 04:30

I think his comments are so stupid that I'm just going to pretend they never happened.

If Linton can't figure out how to offer services to the market (and that means 'old people' too) that's his problem. Someone else who is smarter and more flexible in their thinking will.

As for whatever 'old' even means, I'm not sure. My brother, sister and best friend are all rapidly coming up on 50, nobodies getting any younger - and they are all voracious users of the internet. Their children are too. It is *the* entertainment and communication venue that has pretty much replaced the TV, radio, cinema, postal mail and telephones. What does Linton think these people are going to do? Use less net? Not likely.

The NBN is infrastructure, and you *never* go wrong investing in infrastructure. Linton is a fool.

Comment by Stuart on 31 August 2010 at 05:05

I'm on 1500/256 at the moment (ExeTel on BigPong) in Albany, which is more than adequate for most of what I do, but since the ISP has just negotiated DSL2 rates on BigPong DSLAMs (as well as Optus; BigPong are the _only_ co with any DSLAMs in Albany) I'll be switching but mostly to get wider uplink for running services here.

ExeTel provide static IP addresses (which BigPong don't unless you pay much $$$) & VoIP (9c per call to any land-line in Oz), both of which make a much larger difference to me than a gigabit downlink.

If I had a gigabit (each way) link, I may then have to use something more powerful than a (free) 2GHz dual-core desktop box with 1GB of RAM for a server (as you can guess, it's definitely not running Vista), & would have to plug a gigabit Ethernet card into it.

I have a friend in Armadale who recently switched to TPG. His plan included 700GB a month, which he used up between Tuesday afternoon & Saturday morning, so they clamped him for the rest of that month to 2000/512 or faster than mine goes flat-strap at the moment. His main woe was the future cost of storage (he does lots of things with videos, as well as watch them).

He is the _one_ person I know (of hundreds) who would use a gigabit link & multi-terabyte quota (but he's getting on fine with a tens-of-megabits link & sub-terabyte quota at moment).

My quota is 30GB (plus 120GB 2AM-8AM, so if I want anything large (like a DVD image), cron & wget is my friend, plus a little script which converts YouTube page-references into a download of the actual video itself).

In summary, IMESHO, Linton is correct & by the time he's no longer correct, far better technology will exist to carry out the link-fattening required.

Comment by Leon Brooks on 31 August 2010 at 05:29

The aging population is getting increasingly tech-savvy, partially because they're getting more exposure to computers/the internet but also because a lot more of them are retiring from jobs where they've been using computers for the past couple of decades.

Comment by Jared on 31 August 2010 at 05:30

The ignorance here appalls me.

'Old people' might not understand the tech behind the NBN, but they certainly will understand its benefits.

I'm pretty sure the folks currently trialling the real-time medical monitoring in Tasmania notice the difference.

I'm pretty sure the grandparents in outback SA, QLD, NT, WA, would notice suddenly being able to connect to their excited grandkids youtube uploads without time lags and delays, instead of waiting for half an hour for a 20 min clip to load, as we do now because our current copper-based network is so far behind the cities, it's all but useless for anything more advanced than a basic call.

I'm pretty sure being present through the virtual world for birthdays, celebrations, weddings, even(heaven forbid) being right there in the birthing room would not go unnoticed either.

I'm also pretty sure my 78 yr old father will grab hold of every opportunity to reminisce - the idea of being able to watch F-Troop any time he wants has definitely made him think twice about not being interested.

All of this is questionable under the coalition's plan, if current technology is the backbone. Our telephone exchange was only upgraded for ADSL broadband a few years ago, and ADSL+? Forget it! That's a whole new network upgrade, lines, exchange, everything, and we're only 3 hours from Adelaide.

I'm also pretty sure my brother's going to expect technology to be right up there on the top level right through the next 10 years, when he'll be 55, right on the edge of this 'older age' group. He's been a leader in a government IT department for the better part of 20 years.

So, yeah, older Australian's mightn't understand the technology, but they'll know how to take hold of all the advantages. And how will they learn all of this? That's what the grandkids are for!

Comment by Jae on 31 August 2010 at 06:36

The free market can provide any speed you want, it just depends on how much you are willing to spend. This is the best solution. Providing 1 gigabit of bandwidth to every house in the country is overkill. It is a waste of good money; it's as simple as that. The money that is going to connect those people, could be better spent on something like increasing the bandwidth between Australia and the USA, or who knows what else. The free market, if left uninterfered with, will ensure that investment is made into the technologies that are in demand (ie the stuff that people actually want).

Sometimes private businesses make mistakes and invest in the wrong things, but these mistakes are never far reaching, because the power of individual businesses to invest is not absolute (unless they are a monopoly). The NBN will screw us for decades to come, just as the creation of the Post Master General (aka Telstra) screwed us for many decades (and we still suffer from it today).

Comment by Alex on 31 August 2010 at 07:16

I think it was the Greens who said it best. Much like the highway projects made Australia a viable exporter, we need to actually have some national leadership to make infrastructure that will make us viable for the next couple of decades.

Private enterprise is not going to make this happen, especially with Telstra trying to white ant everything that threatens them.

So I couldn't give a toss about what the head of a two-bit head of a company that is infamous for cornering the market on people who pay too much for net they don't use. The sooner he says hi to the Froggy people the better.

(From a middle age Aussie who doesn't want to see the youth screwed over by a lack of foresight)

Comment by Anthony S on 31 August 2010 at 07:51

To Alex: The free market isn't going to provide the best service to the least profitable areas. If the internet is to be the foundation of our business communications moving forward we can't differentiate between users and profit margins. The telephone has become so ubiquitous because everyone everywhere got the same service from a land-line.

Under a free market model the most populated areas would barter with the market for the absolute minimum (shared) acceptable service, the least populated areas for the lowest acceptable connectivity. Middle Australia would (due to technical quirks) probably get the cheapest and best service.

To leave the free market to decide the cheapest way of keeping most folk happy simply won't provide the best service. Markets thrive in an economy of scarcity and fail long term in an economy with a wealth of assets, so there is no impetus for the free market to plan more than a few years ahead, or to solve only the cheapest and most profitable problems. Nobody wants to wire the bush.

The free market does work better in America, but is riding on the back of a cable and infrastructure industry that's got a 20 year lead on us, and a thirty year lead in de-regulation. We have caught up a lot... but let's remember that ten years ago it cost some AUS $86,000 dollars per anum for the same internet service provided to American households for AUS$240 per anum. Our free market has a lot of catching up to do before it's competitive with legislated infrastructure.

Comment by Paul Vigo on 31 August 2010 at 08:20

He's marking an argument from ignorance and over generalisation. He's ignorant because he can't imagine what might possibly need 1Gbps, and over generalising because he thinks that whatever the older generation needs is enogh for everyone.

As others have said, the free market is going to follow the money. There's no money in the bush, and there never will be.

I think a bigger problem is that the government is going to follow the money too - look at how they allowed Telstra to rape the market for coin. Stuffing the coffers is just too tempting.

What we really need (and will never get) is a wholly wholesale NBN run at near cost, with private vendors on top of that. This isn't about making money from the network, it's about making money from services and businesses built on top of that network (IMO, anyway). We need to make a network that is a utility: reliable, cheap and invisible - so then we can stop worrying about the network and start thinking about the applications.

Comment by Stuart on 31 August 2010 at 10:04

Way to be shortsighted.

Real-time video is just one high-bandwidth application that's potentially transformative, especially in fields like remote education. You can do that on less than a gigabit, but you sure as hell can't do it on dialup.

God only knows what we'll see in the next twenty years.

Comment by Norman Gerre on 31 August 2010 at 22:14

Singapore's model is to provide a very high speed backbone (run by a company and charging downstream). From there the end point vendors can either use the backbone or provide their own and the vendors decide how to deliver and charge it to the customer.

Of course Singapore is a bad model to use for Australia, but since the govt is using it I will to. People forget the Singapore the country is around 1/4 of the size of Perth the city with a population of 4.5million

Second point is the 100MBps bandwidth is only local bandwidth - if you neighbour starts a big torrent download, you are not going to able to get that bandwidth. Movies run on a separate QOS so they will always stream nicely (at least the ones provided by the cable provider)

Do we really need 1GB? maybe one day, but do I want to fund 1GB to people that may never consume it - no way! I'm already funding an inefficient power provider with no competition, why would I want to fund another monopoly?

Comment by Bret on 31 August 2010 at 22:21

Using high bandwidth will really be easier than people think.

According to Wikipedia, a Blu-ray movie can use a max of 54 Mbps. 2 people in
a household streaming high definition movies in real time would exceed 100 Mbps.

An that's just for entertainment.

Given the bandwidth, ultra high definition will become the standard for business and education video calls. Having that level of bandwidth available changes the experience from a fuzzy, jerky video call to something which fools the viewer into thinking they are in the same room. And that will make all the difference to remote education and business services.

Comment by Emmanuel on 1 September 2010 at 02:11

People making comments about video & business & broadband don't sound like they've had much experience in business. Businesses spend money on things that make them money and save them money. Video does neither in the context of the NBN.

Comment by Jimboot on 1 September 2010 at 02:26

@16

Look at the cash being poured into YouTube, Hulu, even iTunes for video. This is a whole new distribution channel - if HBO or the BBC could sell directly to Australian consumers, why wouldn't they? More importantly, if the content creators could sell directly to the consumer, why wouldn't they? Things like niche content become so much easier to do (think full coverage of every single sport at an Olympics - they already send crews to film everything, but they don't have the venue to show it all). There's great opportunity for video on the NBN, I don't understand how you can question that.

Disruptive technologies are the most interesting (and the most profitable). Whomever figures out the killer app for the NBN is going to be very rich. Video is but one potential candidate for that role.

Comment by Stuart on 1 September 2010 at 03:23

Whenever I hear this sort of criticism, my first thought is that the people making the criticism have a vested financial interest elsewhere. Does that make me a cynic?

Comment by Gareth on 1 September 2010 at 21:09

Having spent the past few months in the United States I can say that video on demand via the internet is the only viable way of distributing it to a large and varied population. In Australia we have no alternatives to the various cable monopolies for providing on-demand entertainment.

Those networks are already straining under the load of old technologies, and lock everyone into monolithic providers like Bigpond or Optus. The more content they make available, the cheaper it's got to be, as there are practical management and network limits.

In the United States now most of the tv I've watched has been streamed in HD direct from third parties like netflix and hulu (or digitally via comcast). If you think cable channels in Australia are bad, you should see it over here... it's terrible. Internet video is the only viable and cost effective distribution medium for a lot of smaller shows and movies. Our Australian local networks would be crushed under such a load, even with the proposed coalition enhancements to the backbone.

Comment by Paul Vigo on 1 September 2010 at 21:53

@stuart Ive been doing Internet video for companies since 1999. They wouldnt sell directly to Aussie consumers because of existing licensing arrangements. The ability to do video online is not hampered by bandwidth. Would more bandwidth allow you to do more streams of higher quality? Yes. But from 1998 - 2001 we streamed on avg 300,000 streams per month out of Melbourne. Just by having more bandwidth doesn't mean you'll all of a sudden have lots of video. They can easily stream things like the cricket now but they do it through licensing on networks like 3.

Comment by Jimboot on 1 September 2010 at 22:13

@18 - being a cynic and being wrong are two different things.

@20 - Recording artists weren't able to make much of living without going through the studios (or with, for that matter) until recently either. Now they can. Artificial constraints that only benefit a few tend to suffer under a lowered barrier to market entry.

When you make it easy for people to do something, they will, and sooner or later someone will build a business on top of that capability. For every business screeching "Home taping is killing the industry!" there's another ten selling tapes and tape recorders.

iTunes and Steam are highly profitable businesses that simply wouldn't exist without the net. The video equivalents to those services don't exist yet - when somebody makes a better venue for video (and I consider that a certainty, so it is a when rather than an if) that service or services will find a huge audience (hopefully, a paying audience. Arguably, the current killer app for the internet is media piracy - you need only look at the bittorrent activity in Australia to see that there is a market for the product, and that the market is not being appropriately serviced by legal options. That is indisputable. If the best reason businesses have for not meeting that need is *licensing agreements*, then the people running those businesses are utterly *stupid*).

We need an NBN for all the businesses not stuck in a 30 year old mindset - they are going to be where the money and jobs will be in the future, not some terrestrial TV station that has no clue about doing business on the web. These businesses have no ideas and they don't innovate - and I'm sick of their thinking and their concerns holding the rest of us back. If they can't make money from an NBN, that's their problem - someone else will, and we'll all be better off for it.

Comment by Stuart on 2 September 2010 at 06:12

OMG. Dude I webcasted every major artist that came thru Melb from 1998 - 2001. Sting, Gene Simmonds etc. Do you have any idea how long it took get get itunes in AU vs the rest of the world? Are you paying attention to what is happening with AFACT? RIAA, MPAA etc. Just because you have the network doesn't mean business models will change. Ever heard of Napster? 11 years ago it all started. It had nothing to do with broadband.

Comment by Jimboot on 2 September 2010 at 20:08

@22 -

"Do you have any idea how long it took get get itunes in AU vs the rest of the world?"

Not having a monetised, legal marketplace for music certainly didn't stop people from getting their music online. My point is simple - if the businesses don't keep up, for whatever reason, then people aren't just going to sit around waiting for them.

Unless things change radically, any NBN (regardless of its speed, capacity or architecture) we have is going to have piracy as its backbone - it's been like that since the days of BBS dialling. That doesn't bother me, because the network gets build off the back of that, and then legitimate businesses can take advantage of it.

"Are you paying attention to what is happening with AFACT? RIAA, MPAA etc."

Yes, they are adopting an aggressive, punitive, litigious stance, and it's failing miserably. What they are doing is not furthering their businesses in any way, it's certainly not curbing piracy to any significant extent. When people hear "You wouldn't steal a car!" they laugh in scorn - it's a joke.

"Just because you have the network doesn't mean business models will change."

If you create a new environment, businesses will evolve to occupy that environment. The internet has indisputably changed doing business - there are so many enterprises that not only couldn't exist without the web, they would have been *inconceivable* 10 or 20 years ago. This is the key point about NBN speeds - we don't currently know what the killer apps of high speed/bandwidth will be, but we've got some pretty good evidence that whatever they are, they will be transformational (and my hope is that it will also be profitable. As you accurately state, the reticence and pig-headed stubbornness of current businesses is a huge burden on progress - it will take time for them to be out competed).

The idea of a person involved in major web streaming asserting that the internet is not disruptive to existing business models beggars belief.

"Ever heard of Napster? 11 years ago it all started. It had nothing to do with broadband."

It had a lot to do with the network structure though. Napster worked so well because it leveraged the network - it wasn't an idea that could have worked without as many participants as it had.

Are you seriously arguing that if you gave the guys at the Pirate Bay, Apple and Valve, a huge, fast IP network that they wouldn't make something amazing on it? You give smart (technology and business) people these opportunities and they will run with it. Valve has rewritten the business model for game sales, Apple has a hardware business built off the back of their CDN (iPods simply wouldn't exist without iTunes), the Pirate Bay made a *political party/movement* for goodness sake, and you are arguing that nothing's changed? You're so wrong.

Comment by Stuart on 2 September 2010 at 22:15

I am an ageing one who most certainly wants the fastest most reliable and most economical access to the world that I can get. Geez we're gonna have to work if we can til we're 85 anyway...can't you let us have some fun? and some proper access to the world, including online games. We don't all like knitting.

"Linton added Australia’s ageing population — who he said didn’t “play online computer games or get a surrogate sex life from pornography” had no interest in terabyte broadband plans"

Speak for yourself Linton, you don't speak for me or my friends.

Comment by sue on 2 September 2010 at 23:47

You totally miss my point. You're arg is that more bandwidth = amazing video services to the home. I'm saying that it takes a hell of a lot more than bandwidth to change business practices & the existing food chain. The music & the film industry have been dragged kicking & screaming. Bandwidth isn't the issue. They're refusing to accept the market correction. I'm not saying that is what is best. I am saying that is the reality. Broadband helps us get our data faster. But to completely saturate your shiny new fibre with lots of VOD is not a good biz decision.

Of course the net can be disruptive. If it wasn't for a 16yo turning a multibillion industry on its head overnight we wouldn't have ipods etc. Any business that is created purely because the NBN exists though, will fail. That isn't to say that already good business models won't benefit from the NBN. Anyone who went through the dotcom era can tell you that.

Comment by Jimboot on 3 September 2010 at 00:39

@25

1) I think VOD as it stands won't actually be that big of a deal. Of course the studios get excited at the prospect of doing things exactly as they always have - that's because they don't get it. Studios look at the web and think movie rental, the rest of us look at the web and think amateur memetic cat videos.

2) I think it takes time to kill off the old ways. If perfect fusion was viable tomorrow would oil companies embrace that, or would they fight it with everything they had? It's not hard to understand why king making opportunities are viewed dimly by the existing kings - the best they can hope for out of disruptive technologies is to keep what they already have.

3) The current situation is bad for existing businesses that refuse to adapt. I think that a bigger, faster network would exacerbate that situation further. I like the idea of that - these businesses have been given every opportunity to change and they have refused to, so now it is time to switch focus from aiding them to penalising them. Either they serve the market or they have no place in it.

4) Any business created because roads exist will fail, any business created because electricity exists will fail - see how silly that sounds today? The NBN is a utility, that's all. It makes certain things possible and easier, but it doesn't guarantee any outcome at all - that's up to businesses. I personally don't believe you can go wrong investing in infrastructure and that's why I'm in favour of the 'best' system we can get.

Comment by Stuart on 3 September 2010 at 01:17

@24 & 25
True VOD isn't the biggest deal. I think the main strength of the NBN is in building that extra capacity, and guaranteeing it is available at every point in the network. This is a "last mile" solution which will significantly reduce the startup and long term running costs of any smaller businesses which find they need reliable high bandwidth available for new business models.

The current alternative to the NBN put forward by the coalition (and some interested telcos) guarantees only a peak point to point speed, and any concentration (ie b2b or online provision of services) would compete for the available. If you're bricks and mortar business that relies on the internet, 4G just doesn't cut it as a stopgap alternative.... nor would it ever be cost effective.

So much of the argument has been about if consumers are better served by the coalition plan or the NBN that business and producers have been forgotten. Providing premium scalable service to every point in the country will ease the burden of implementing new business models, and business innovation brings money and jobs to the benefit of everyone.

Comment by Paul Vigo on 3 September 2010 at 01:56

I suppose I Linton's demographic; I'm coming up on 50. I spend more time on the web than my kids (because my work is on the web as well as my play), and I certainly know more about computers/computing than my kids.
I find his remarks offensive, to be bundled into a box labelled "oldies who only need dial-up to log in into their email".
pffft.